Insurance company demands $10M from diocese for sex abuse payouts
An insurance company is demanding the return of $10 million in sex abuse settlements paid to the London diocese, claiming the Catholic Church exposed it to increased risk by hiding the actions of several pedophile priests.
AXA Insurance Canada is claiming the Diocese of London misled the company and its predecessor, Great American, by moving former priests — including Charles Sylvestre and John Harper — from parish to parish for decades to hide their misdeeds.
According to a 2016 Superior Court document in which the judge ruled against having a jury trial in the case, AXA states it would not have insured the diocese if it was aware of the priests’ backgrounds.
“If the Diocese had disclosed the information it had concerning Sylvestre and Harper, Great American would have refused to provide a policy of insurance or any renewal, would have refused to insure against liability arising from assault and battery, would have included appropriate exclusions, and/or would have increased the quantum of the premium charged given that this information dramatically affected the risk,” the document says.
The court battle began in 2008 when the diocese sued AXA for acting in “bad faith” by refusing pay settlements totalling $874,000 in two sex abuse lawsuits involving Harper. AXA responded by countersuing for the $10 million the company and its predecessors had paid the diocese to settle previous lawsuits launched by sex abuse victims.
A lawyer for AXA couldn’t be reached for comment on Monday.
“Because it’s an active court case, we can’t comment,” said diocese spokesman Nelson Couto.
None of the allegations in the document have been proven in court.
The fight over insurance coverage focuses on a few of the more than 20 London diocese priests who have been convicted, charged or sued for sex crimes against children.
Among the most notorious was Sylvestre, who pleaded guilty in 2006 to sexually assaulting 47 young girls over more than three decades in Chatham, Pain Court, Sarnia, London and Windsor.
He died in prison at age 84 after serving less than four months of his three-year sentence.
Harper, who was convicted in 1988 and again in 2003 of sexually abusing young boys, liked to take his victims on weekend getaways to his parents’ Windsor home.
The court battle over the insurance coverage centres around a policy that the diocese says it was protected by between 1963 and 1971.
The diocese claims in the 2016 court document that Great American provided it coverage for bodily injury claims from May 1, 1963 to May 1, 1971.
That included “assault and battery by a person, arising out of or in the course of his duties as an employee.” The policy had a limit of $1 million for any one occurrence.
AXA states in the court document that no Great American insurance policy has ever been found for any diocese except the one in Sault Ste. Marie.
But if a policy did exist, AXA claims it is void because of “material misrepresentation and/or non-disclosure” from the diocese.
According to the document, AXA alleges the diocese “dealt with the allegations of sexual assault by these priests in secrecy as required by Canon Law.”
AXA states that the diocese had evidence that Sylvestre was sexually abusing little girls by at least 1962 — before the Great American insurance policy would have been issued.
After the disgraced priest’s guilty pleas in 2006, Bishop Ronald Fabbro revealed his assistant had found copies of statements three victims made to Sarnia police in 1962.
Fabbro said the statements were discovered in the back of a filing cabinet full of accounting documents at the diocese office in London.
AXA claims the diocese was also aware by 1964 that children had made similar sexual assault allegations against Harper, who was sent for psychiatric treatment.
“The sexual assaults by Sylvestre and Harper, and the subsequent placement of these priests into positions of trust and authority in relation to children was information material to the risk allegedly insured by Great American,” AXA claims in the court document.
“The Diocese failed to disclose that information to Great American at the time the Diocese allegedly applied for and obtained insurance coverage and renewals.”
Failed to disclose that information ... at the time the Diocese allegedly applied for and obtained insurance coverage.